MANILA -Higher generation charges triggered an increase in Manila Electric Co.’s (Meralco) May electricity rate by P0.1761 per kilowatt-hour (kWh), the power distributor announced on Thursday.
This brings up a typical household’s overall electricity rate to P11.4929 per kWh from P11.3168 per kWh in April. Residential customers consuming 200 kWh a month can expect an increase of about P35 in their total bill.
Higher spot market and power supply agreement (PSA) costs were the main drivers of the increase in generation charge, which went up to P7.6697 per kWh from P7.3295 per kWh the previous month.
Generation charge is the cost of purchased power from suppliers and accounts for more than 50 percent of a customer’s total monthly bill.
According to Meralco, the amount is already inclusive of the final installment of deferred generation costs equivalent to 20 centavos per kWh.
To recall, the power firm deferred the collection of some P1.1 billion in total March generation costs. Collection was staggered to cushion the impact of the rate increase on its 7.6 million customers.
This was due to the 15-day maintenance shutdown of the Malampaya gas field in February, which increased power plants’ dependence on more expensive alternative fuel to ensure supply continuity.
Spot market charges went up by P1.7367 per kWh due to higher demand in the Luzon grid, which peaked at 12,235 megawatts (MW) on April 19, or 732 MW higher than the recorded peak in March.
Charges from PSAs, meanwhile, rose by P0.9086 per kWh on the back of lower excess energy deliveries, which were priced at a discount, Meralco said.
“This month’s rate increase was tempered by the P0.2455-per-kWh reduction in the transmission charge due to significantly lower ancillary service charges,” the company added.
The final tranche of a distribution-related refund equivalent to P0.8656 per kWh will be distributed this month, slightly tempering electricity rates. Customers, however, must brace for an impact on their electricity bills in June, as they will no longer be receiving refunds by then, Meralco said.
In April, softer spot market prices offset the anticipated increase in generation cost due to deferred charges.
Meralco said its distribution charge has not moved since the P0.0360 per kWh reduction for a typical residential customer in August 2022.
Given historical spikes of 10-40 percent in power consumption during dry seasons, Meralco urged the public to “embrace energy efficiency and conservation” in the coming months.
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